Correlation Between Auction and Badger DAO

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Auction and Badger DAO at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Auction and Badger DAO into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Auction and Badger DAO, you can compare the effects of market volatilities on Auction and Badger DAO and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Auction with a short position of Badger DAO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auction and Badger DAO.

Diversification Opportunities for Auction and Badger DAO

0.87
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Auction and Badger is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Auction and Badger DAO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Badger DAO and Auction is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Auction are associated (or correlated) with Badger DAO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Badger DAO has no effect on the direction of Auction i.e., Auction and Badger DAO go up and down completely randomly.

Pair Corralation between Auction and Badger DAO

Assuming the 90 days trading horizon Auction is expected to generate 1.24 times more return on investment than Badger DAO. However, Auction is 1.24 times more volatile than Badger DAO. It trades about -0.09 of its potential returns per unit of risk. Badger DAO is currently generating about -0.12 per unit of risk. If you would invest  2,943  in Auction on February 27, 2022 and sell it today you would lose (2,329)  from holding Auction or give up 79.14% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Auction  vs.  Badger DAO

 Performance (%) 
      Timeline 
Auction 
Auction Performance
0 of 100
Over the last 90 days Auction has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Crypto's forward indicators remain quite persistent which may send shares a bit higher in June 2022. The latest mess may also be a sign of long-standing up-swing for Auction institutional investors.

Auction Price Channel

Badger DAO 
Badger Performance
0 of 100
Over the last 90 days Badger DAO has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Crypto's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in June 2022. The current disturbance may also be a sign of long term up-swing for Badger DAO investors.

Badger Price Channel

Auction and Badger DAO Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Auction and Badger DAO

The main advantage of trading using opposite Auction and Badger DAO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Auction position performs unexpectedly, Badger DAO can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Badger DAO will offset losses from the drop in Badger DAO's long position.
The idea behind Auction and Badger DAO pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
Check out your portfolio center. Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

Other Complementary Tools

Headlines Timeline
Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity
Go
Portfolio Comparator
Compare the composition, asset allocations and performance of any two portfolios in your account
Go
Portfolio Manager
State of the art Portfolio Manager to monitor and improve performance of your invested capital
Go
Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Go
Portfolio Volatility
Check portfolio volatility and analyze historical return density to properly model market risk
Go
Bollinger Bands
Use Bollinger Bands indicator to analyze target price for a given investing horizon
Go
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Go
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Go
Portfolio Optimization
Compute new portfolio that will generate highest expected return given your specified tolerance for risk
Go
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Go